Insights

Five Personal Finance Books to Help You Overhaul Your Finances and Your Life

By  Karen Banes

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Not one of these books is remotely in the ‘get rich quick’ category, but if you’re aiming to slowly but surely overhaul your finances and provide long-term financial security and freedom for yourself and your family, I suggest you put these on your reading list.

The Millionaire Next Door by Thomas J Stanley

It will come as no surprise to my regular readers that this one tops the list. I quote from it regularly in my personal finance articles, and I often point out how learning to spend like a millionaire (and think like one) is actually the first step to financial freedom. This book is all about how to start seeing money as something you accumulate, for the sake of financial security and personal freedom, rather than something you spend, to look good and impress other people. It’s message is very much against conspicuous consumption and in favour of quietly accumulating, and enjoying, wealth.

The Richest Man in Babylon by George Clason

This is another big favourite of mine, and I’ve written a whole article on this 100-year-old book that somehow still manages to be a valuable guide to personal finance today. That’s because it addresses not specific techniques but big-picture concepts, like using money to make money, paying yourself first, researching your investments, and being very careful about where you get your financial advice from. The book isn’t a straightforward financial advice book, of course. As the title implies, It’s set in ancient Babylon, and presented as a series of snippets of advice, supposedly given to a poor chariot builder by a rich man he goes to for advice.

The Automatic Millionaire by David Bach

This is another book that we’ve discussed before here at Wealthtender. It aims to give practical, actionable advice for building wealth in a systemised, and at least partially automated way. This book is the first place I saw the statement, apparently offered to the author by his grandmother during a childhood trip to McDonald’s, that there are three types of people: those who work at McDonald’s, those who eat at McDonald’s, and those who invest in McDonald’s. The author then aims to convey sound, step-by-step advice that could potentially be applied to help you move from the first category to the third. Not that everyone necessarily wants to invest in McDonald’s of course. Depending on your principles, you may prefer a sustainable fashion company or Vegan ETF.

The Total Money Makeover by Dave Ramsey

This book contains one of my favourite quotes about money, though I’m not sure if Ramsey was the first to come up with it:

“We buy things we don’t need with money we don’t have to impress people we don’t like.”

This is far too true for far too many people, and is at the root of a lot of money problems and specifically a lot of debt problems. Ramsey sets out seven baby steps to take to get yourself out of debt and on the road to financial freedom. The steps are no secret (they’re easily accessible at the author’s website) but basically involve:

  • Building an initial emergency fund
  • Paying off debt
  • Building a bigger emergency fund
  • Saving for retirement
  • Saving for your kids’ college (if you have kids)
  • Paying off your home
  • Building wealth and giving back

There’s more detail to each step of course. Ramsey recommends an initial emergency fund should be $1000, whereas your final emergency fund should contain 3 – 6 month’s expenses. His suggestion for retirement saving is 15% of your household income. The steps are fairly specific and almost everyone I talk to about this book points out they had to adapt some things to fit their own circumstances, but the basic advice is worth considering.

Your Money or Your Life by Vicki Robin and Joe Dominguez

A personal finance book with a twist, this one looks at how our relationships, wellbeing and personal life are affected by our finances. Its aim is not just to help you ‘get more money’ but to support you as you transform your relationship with money, and improve your whole life in the process. While most of us realise fairly early on that money really doesn’t make you happy, it’s also fair to say that, ultimately, life satisfaction and personal finances are inextricably linked together. This book addresses how to assess and change:

  • Your relationship with money
  • How well your spending aligns with your values
  • How you can reconnect with old dreams and find ways to realise them
  • Your satisfaction with your contribution to the world
  • The amount of free time you have and how this ties in to your finances

More than a money mindset book, however, the authors offer practical ways to improve both your finances and your life.

There are many more books out there that will help you address specific money issues such as making money or investing, but if you’re aiming to improve your general financial position and work toward financial freedom this year, these are definitely a few to consider.

Karen Banes

About the Author

Karen Banes

I’m a freelance writer specializing in online business, personal finance, travel and lifestyle. I also work as a content creator for hire, helping brands and businesses tell their stories, grow their audiences, and reach their ideal customers. I’ve lived, worked and studied in six countries, across three continents. Stop by my blog TheSavvySolopreneur.net to learn how to run your own (very) small business on your own terms. You can also connect with me at my website KarenBanes.com or follow me on Medium.com

Disclaimer: The information in this article is not intended to encourage any lifestyle changes without careful consideration and consultation with a qualified professional. This article is for reference purposes only, is generic in nature, is not intended as individual advice and is not financial or legal advice.

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